Several factors contributed to Tesla's high valuation. First, a large portion of the stimulus capital that entered U.S. capital markets went towards innovative firms like Tesla. Despite manufacturing significantly fewer cars than Toyota, Daimler, Volkswagen, and Honda, Tesla's focus on electric vehicles and self-driving technology has made it a leader in the automotive industry. Additionally, Tesla's strong balance sheet, high-value assets, and low fixed costs have made it an attractive investment. Finally, the overall market trend towards consolidation around innovators and market giants has further boosted Tesla's valuation.
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